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Creditor fraud: a cause of action or a category of claims?(CREDIT COLUMN)

Business Credit

| November 01, 2005 | Marino, Joseph A. | COPYRIGHT 2005 National Association of Credit Management. This material is published under license from the publisher through the Gale Group, Farmington Hills, Michigan.  All inquiries regarding rights should be directed to the Gale Group. (Hide copyright information)Copyright

Recently a new cause of action referred to as "creditor fraud" has appeared in cases where an attorney has advised and facilitated a debtor to fraudulently convey property and/or hide assets to delay, hinder and avoid creditors.

Is there a need for a new cause of action? Or does the term creditor fraud refer to a variety of traditional causes of action?

On June 27, 2005, the Supreme Court of New Jersey, in a 7-0 decision in Banco Popular North America v. Gandhi, written by Justice Long, held among other points that: The alleged cause of action called "creditor fraud," does not exist under New Jersey law; abrogating the holdings of two recent Appellate ...

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